When new technologies are developed, they provide new opportunities to innovative companies and disrupt whole industries.
There are many examples of this throughout history, and as a CIO, you’ve probably experienced disruptive technologies firsthand. The internet, the mobile web, and cloud computing are some of the very disruptive technologies your company and others needed to adapt to. Companies and industries as a whole were forever changed or made obsolete by the advances.
Technology is still moving forward, and CIOs will need to deal with many more disruptive technologies in their careers. They’ll need to hire talented IT professionals to help them adapt to the changes. One disruptive technology that’s getting a lot of attention right now is blockchain.
Blockchain is a digital ledger that’s used to record transactions. The ledger is stored on a network of personal computers. The records, called blocks, are time-stamped and linked to the previous blocks. This forms an unchangeable record. Once new data is entered, it can never be erased. This is the technology behind Bitcoin, a well-known cryptocurrency.
While your company may not be interested in using Bitcoin any time soon, the technology behind it may still affect you. This technology has many possible uses for businesses. It’s projected to disrupt many industries, just like the other technologies that came before it.
Here are nine big industries blockchain technology will disrupt in the future.
1. The Banking Industry
Banks securely store money for their customers and handle money transfers. For these services, they charge high fees. On top of monthly service fees, customers could need to pay fees for things like making payments on their credit cards. These fees aren’t optimal for customers.
Blockchain’s secure system could solve several problems for banks. The indisputable, permanent record of transactions could lower risks for banks. Customers will be able to see the status of their payments at any time. Money could also be transferred both cheaper and faster.
Banks that take advantage of this technology could provide better services to their customers at lower prices.
2. The Money Transfer Industry
Many companies allow people to transfer money to each other, both domestically and internationally. They make their money by collecting a fee every time someone sends a money transfer. As the middleman, they’re vulnerable to disruption by blockchain technology.
Some FinTech companies are taking advantage of this technology. They offer money transfers for lower fees than traditional providers charge. Traditional money transfer companies will need to be adapt or they’ll be left behind.
The FinTech startups could be left behind, too. With blockchain, people can send money to each other directly, without paying any fees. Since the technology is new, this isn’t widely used but should be a concern for any company in the money transfer industry.
3. The Stock Trading Industry
The stock trading industry profits from commissions and fees. When people buy or sell stocks, they need to pay a broker or middleman. Companies have worked to make the process of buying and selling stocks easier, but there are still more improvements that could be made.
These improvements could be made with the help of blockchain technology. With this technology, trades can be made accurately and inexpensively. While traditional trades can take up to three days to be settled, blockchain trades can be settled instantly. The trades can also eliminate middlemen. Overstock.com was the first publicly traded company to start issuing its stock through this new technology. In the long term, more companies may follow its lead.
4. The Online Music Industry
There are many criticisms of the online music industry in its current form. Streaming services don’t pay artists much per stream, and the streaming service and record label also get a cut of the profits. Some artists even go as far as removing their songs from streaming services.
Blockchain technology has the potential to shake up this industry. With this technology, artists may be able to offer their songs directly to their listeners. This will let them bypass the streaming services entirely. Artists may also decide to offer songs through the new technology instead of going through a record label. This could be worrying for streaming services and record labels alike.
5. The Real Estate Industry
Right now, there’s a lot of paperwork involved with real estate transactions. Errors in this paperwork could slip into public records, and fraud is another potential complication. These issues keep real estate agents, financial institutions, and mortgage companies busy.
With blockchain technology, real estate data like liens and land titles can be stored safely and permanently. Documents will be secured, with less work and less expense.
Blockchain could also eliminate escrow companies. With this technology, smart contracts could be created that would only release funds when contract conditions are met. That’s what escrow companies do now, so this new technology could be quite disruptive for them.
6. The Healthcare Industry
For patients to get good care, their medical records need to follow them from one doctor to another. When patients see several doctors, it’s easy for records to get lost or not be transferred between doctors. This causes continuity-of-care issues, and patients could receive poor care. They could be misdiagnosed or receive treatments that aren’t effective due to their incomplete records.
This problem could be solved with blockchain technology. It’s an excellent platform for data storage, and it can be used to hold patients’ medical records. Doctors, hospitals, insurance companies, and other healthcare institutions could all see patients’ complete medical records. Some startups are working to make this a reality.
7. The Legal Industry
Some types of litigation could be impacted by blockchain technology. Wills are a good example. Currently, family members may doubt the genuineness of a will and turn to litigation to resolve a deceased loved one’s estate. Lawyers need to determine if the will and other documents relating to the estate are genuine.
Blockchain can make this process much easier. Since the records can’t be altered, information relating to wills can be securely stored. No one will have any doubt the will is genuine or that it’s the most recent version of the document. Lawyers who specialize in wills and similar disputes could find themselves out of the job.
8. The Ride Sharing Industry
Ride sharing companies like Uber and Lyft disrupted the taxi industry. However, that doesn’t make them immune to disruptions of their own. To use ride sharing companies, customers need to go through a centralized network—an app—to find drivers. The ride sharing companies are a middleman between riders and drivers, and take a cut of the fees.
With blockchain, customers could bypass current ride sharing companies. La’Zooz is a ride sharing startup that’s taking advantage of this technology. The startup lets riders find drivers who are already making the trips they’d like to make. The company is decentralized, just like the technology it uses to process payments.
9. The Human Resources Industry
Human resources professionals have to do a lot of time-consuming verification tasks during hiring. They need to verify candidates’ employment histories and perform background checks. Right now, the relevant records could get misplaced or even be falsified.
Blockchain ledgers can make HR’s verification tasks much easier. The ledgers can’t be falsified or tampered with, so it’s a good place to store records. If employment records and criminal records were safely stored in the ledger, HR professionals could quickly verify candidates’ background.